Setting Up A Representative Office in Vietnam: A Quick Guide

Setting Up A Representative Office in Vietnam: A Quick Guide
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When it comes to company registration in Vietnam, one of the legal entity options a foreign company would consider for their business establishment is a representative office.

A representative office gives a low-cost option for companies, especially for the first-time entrants who seek to understand the Vietnamese market. This is usually done before a foreign company makes a full entry or a larger presence by setting up a foreign company in Vietnam.

This article provides you with a quick guide to help you, as a foreign company, set up a representative office in Vietnam.

Vietnam Company Registration with A Representative Office

What CAN a Representative Office Do?

Activities that a representative office is permitted to do are the following:

Market research

Serving as its parent company liaison company

Activities for promotion purposes through seminars, meetings, seminars or other activities.

What CAN’T a Representative Office Do?

A representative office is forbidden to carry out the following activities:

Any business activities that will generate income or revenue for the parent company.

Before getting a license for your representative office establishment, you will need to make sure that the following documents are ready. Most of the documents required a consularized copy and a notarised copy. Also, they will need to be translated into certified Vietnamese copies.

Incorporation certification and business registration certificate of the parent company

Latest audited financial report of the parent company

Document stating the landlord’s legal rights for leasing the office

Memorandum of Understanding (MoU) of leasing contract

A signed leasing contract

Business Process after Successful Representative Office Licensing

After you have acquired the representative office license, here are the things you will need to do to complete the entire representative office establishment process. Keep in mind that all required documents shall be notarized and translated into Vietnamese.

Making a seal for the documents of your representative office: representative office establishment license, and Chief of representative office’s passport (for foreigners) or ID (for Vietnamese)

The timeframe for setting up a representative office is between 1.5 months to 2 months. Cekindo recommends you to hire a professional consultant to help you through the entire setup process for compliance and time-saving.

The validity of a representative office license is five years, and extendable for an extra five years.

Tax Reporting and Hiring for Representative Office

Currently, Vietnam has no restriction on the number of foreign employees that a representative office can hire. Of course, a work permit is required for each foreign worker in Vietnam. Hiring and recruiting of foreigners can be made easy through the assistance of a recruitment and HR agency.

As for tax reporting, a representative office is only responsible for employee’s personal income tax (PIT), but not subject to corporate income tax (CIT) in Vietnam. All tax reports have to be submitted by January 30 every year.